Friday, October 7, 2016

Creating a new business is not rocket science. Whether you are starting a paper route, or commercializing a complex technology, the same basic principles of success apply. I found this illustrated well in a new book I just finished, “A Paperboy’s Fable,” by a young entrepreneur and writer Deep Patel. It doesn’t take a superior intellect or big credentials to succeed in business.

Although just seventeen years old, Patel has some great insights that I can extrapolate for every aspiring entrepreneur to answer the most common question I get as an advisor and mentor – “Where do I start?” I’m convinced that anyone who really practices the principles outlined in his book not only will have no trouble starting, but also will have a higher probability of success:

Search for big opportunities. Most founders know exactly what they want to sell, and they are personally convinced that everyone will buy one. Yet you should realize that your view is likely biased, so outside industry expert data is needed for validation. Selling something that only a few people need, even newspapers, is not conducive to success.

Invest in your own future success. It takes time, effort, and other resources to start a business. Be prepared to learn some new skills, assemble the right team, and make some sacrifices to get things going. Aspiring entrepreneurs who expect outside funding, reduced work hours, and friends to volunteer, will likely find a hard road ahead.

Harness ingenuity and innovation. Nothing worth doing hasn’t been tried before, so winning requires bringing something new to the table. Newspapers can be delivered sooner or more accurately, or technology can be innovatively packaged or personalized.

Don’t forget the marketing. “If we build it, they will come” is not a winning business strategy. You need to find the customers, rather than waiting for them to find you. With social media and conventional selling, the people with the best message get the order.

Add value and reduce cost for universal appeal. Addressing a worthy cause, such as helping the environment, has a good secondary appeal, but near-term value delivery is usually necessary for business sustainability. Goodness alone doesn’t make a business.

Create customer advocates. Every business needs multipliers to succeed, and one of the best is customers who are so excited and satisfied that they drag in friends. Paper routes succeed best when customers recommend you to neighbors and associates.

Choose a business that you can scale. Services businesses are hard to grow, as you need to clone people to expand. Product businesses are easier to scale, through manufacturing and automation. Don’t be too slow to expand your territory and partners.

Utilize the power of diversification. The author didn’t forget that newspaper customers make good candidates for lawn services and cleaning products. Even huge businesses, like Facebook, have expanded into dating, through Tinder, and games, with Angry Birds.

Hire more expertise and delegate authority. No matter how dedicated, one person can only do so much, while making every decision. Smart entrepreneurs learn quickly to hire people who can operate independently, utilizing the existing brand, and make 1+1=3.

Don’t box yourself in with your brand. Brand for the future. It’s hard to expand “Ty’s Newspaper Business” into landscaping and home products. It’s always expensive to change and rebuild a brand image. Give yourself the maximum flexibility in brand building and naming.

Following these principles, and practicing incremental and continuous learning, are the best ways to prepare for the life you want as an entrepreneur or business professional. Also, before you can decide where to start, you need to define what success means to you.

Success to you probably includes financial gain, but don’t forget that money doesn’t buy lasting satisfaction and happiness. The happiest business people don’t work for money, and don’t even think of what they do as work.